Softbank’s bid for Sprint close to U.S. security OK

Softbank Corp.’s $20.1 billion takeover of Sprint Nextel Corp., the third-largest U.S. wireless carrier, is close to passing a national security review by U.S. officials, a source said.

The Committee on Foreign Investment in the U.S. is close to advising Softbank and Sprint that it has no unresolved national security concerns, said the source, who asked not to be named because the information hasn’t been announced.

CFIUS, an interagency panel that scrutinizes acquisitions by international buyers, and the two companies reached an agreement following a thorough review of the proposed transaction, the source said.

Dish Network Corp., which has made a $25.5 billion counteroffer for Sprint, has said allowing Softbank to control a U.S. phone network would compromise national security. Softbank uses some network gear made by Chinese manufacturers, and Sprint’s joint venture partner Clearwire Corp. has Huawei Technologies Co. equipment in part of its network. Both carriers have said they plan to discontinue purchases and dismantle network equipment provided by Chinese companies.

Key terms of the agreement include the appointment of a national security director to Sprint’s board and provisions that will allow the government to approve non-U.S. vendors, the source said. The agreement also has a provision to remove equipment from Clearwire’s network made by vendors that haven’t won national security approval.